ASHLAND, Ky. (KT) - Braidy Industries finalized the purchase of 204 acres of industrial park land in northeastern Kentucky, securing the way to construct a $1.3 billion aluminum rolling mill.
Leaders of the Northeast Kentucky Regional Industrial Park Authority on Wednesday closed on a transaction with Braidy for the purchase of the land at EastPark Industrial Center. The total sale price is more than $900,000, EastPark board chairwoman Nickie Smith said.
The news might as well have been gift-wrapped in Christmas paper.
“I think it was symbolic for him to get this thing closed before Christmas,” said Tim Gibbs, the president of Ashland Alliance, which was instrumental in helping bring the plant to northeastern Kentucky last spring. “It’s a very good Christmas present for the region.”
Boyd County Judge-Executive Steve Towler agreed with the Christmas analogy, calling it “the best news we’ve had around here in a long time.
“There’s something about northeast Kentucky that he likes,” Towler said, referring to Braidy Industries CEO Craig Bouchard. “This is a great Christmas present for ’17 and we think ’18 will be a big year.”
Braidy plans to build the mill on Site B at EastPark, which is located mostly in Boyd County but includes Greenup County territory.
In addition to the land purchase, Braidy also acquired a 110,000-square-foot spec building. EastPark took out a $2.2-million loan when it built the spec building in 2002 to attract potential suitors, though the building has remained vacant.
Before the sale, the spec building was listed on the market for $1.25 million.
Through the agreement, Braidy will assume the outstanding construction loan balance for the building. The EastPark board, according to Smith, already paid off a majority of the debt prior to the sale to Braidy.
Prior to agreeing to close on the purchase, the EastPark board also made changes to the restrictive covenants included in the deed by reclassifying Site B. The section of EastPark had been labeled available for light manufacturing only, but Braidy’s plant will be considered a medium manufacturing facility, according to Smith.
“We had to make some changes to the covenants, but these weren’t major changes,” Gibbs said. “The covenant was made in 1999, that’s 18 years ago. So some changes were necessary. Craig wanted to go to every single property in EastPark and give them a say. He asked them for input. That’s how he does things. This region is important to him.”
Gibbs said Braidy “brings a lot to the table” and its presence in EastPark will likely spur more industry to northeastern Kentucky. “We’re going to have an anchor that is going to attract additional business to this region,” he said. “Braidy has a lot of tenticles.”
Braidy announced plans to build its mill in EastPark in October. The company was originally going to locate the plant on the outskirts of Greenup County, but soil tests on the riverfront found the property incompatible for the mill’s construction.
"This is another step, another huge step," Gibbs said of the property purchase. "The next step after that is breaking ground in April."
Gibbs said, in the scope of all that needed to be done when Braidy began looking seriously at EastPark as its site in October, the process has moved swiftly. "The survey work alone took 40 to 45 days," he said.
"Eight months ago they said they were breaking round April 1 2018 and they're still on schedule," Gibbs said. "They presold 160 percent of their first-year capacity. For them, staying on schedule is crucial. They sold the product, they need to perform."
EastPark is a 1,000-acre industrial park at the junction of Greenup, Boyd and Carter counties. The aluminum mill would neighbor an Ashland Community and Technical College campus. The company has worked with the college and the Kentucky Community and Technical College System to develop a joint training program for prospective employees at the mill.
Braidy, headquartered in downtown Ashland, said it plans to create 550 permanent positions and 1,000 construction jobs. The average pay for permanent employees will be about $70,000, according to Braidy.
Braidy’s goal is to become the nation’s low-cost producer of high-quality auto body sheet aluminum, plate and “ulta-high strength alloys for the aerospace industry.”
The company received incentives from the state and local governments. The state invested $15 million in the project, and agreed to provide up to $10 million in tax incentives. Boyd and Greenup counties agreed to allow Braidy to forgo paying property taxes on the property in EastPark for 20 years.
Kentucky Power also incentivized the company by offering favorable electric rates during negotiations.
The company said it still plans to break ground on the mill in April and open in 2020.